Chain Reaction Slams World Housing Markets

The world financial system is in a chain reaction collapse and if drastic changes aren’t implemented, the structure of the world’s economy will be changed forever, according to economist Lyndon LaRouche, who ran for U.S. President eight times, more than any other candidate for the nation’s highest office.

“I said that in 2007 that the situation, the inflationary structure inside the mortgage-based securities system, was about to blow up,” LaRouche, now 88, told a private gathering in Washington, D.C. “I put forth a motion, a Homeowners and Bank Protection Act, which was very popular. A lot of muscle was put into motion (in Congress) in September of that year to prevent that from occurring. Had that occurred we would not be in the present mess.”

Congress was about to vote to reenact the Glass-Steagall Act, which was eliminated by President Bill Clinton as he left office withdrawing the rules regarding the trading of derivatives and other securities on Wall Street. Bankers had found the president they’d been looking for to extinguish the laws for 20 years so they could implement more aggressive investing and sell trillions of dollars worth of mortgage-backed securities.

“But the British government made a threat to the U.S. administration (President George W. Bush) saying that any attempt to impose a Glass-Steagall reenactment inside the United States would be considered as a virtual act of war against the British,” said LaRouche.

Financial analysts say that the United Kingdom’s economy may have been severely damaged at the time, going into a chain reaction drop that would have crippled the nation’s economy, sending its housing and financial markets to crash. Four years later the UK housing market is sustaining a similar blow to its values that the U.S. market has suffered, and there are few, if any signs that home values will do anything but decline for the foreseeable future in most areas of the UK.

Were it not for the fact that LaRouche ran for president eight times, has had a history of making what critics call outrageous statements and served time in prison on convictions related to fraudulently selling shares of a company that was not registered with the U.S. government’s SEC, LaRouche may be taken with more credibility and get more coverage in the mainstream media. But there’s no denying the former presidential candidate’s successful track record when it comes to the economy. He has been right about forecasting the U.S. economy 50 years.

“The entire world system is now in a chain-reaction collapse, because the way the system works, is [through] the Federal Reserve System, which is controlled by the British, not by the American interests,” said LaRouche.

“We would have to dump the whole thing and start all over again, which nations have done in the past, under warfare conditions and so forth—as Germany was rebuilt after World War II, through a process. So, this does not mean that the United Kingdom would disappear. It means that the system , which is a British-dominated system [would disappear], and the BRIC is part of the British-dominated system.

“I warned that we were headed for a chain-reaction collapse of our national credit system or monetary system — A collapse which was based on wild speculation in a housing market, which was completely insane. So, I proposed a piece of legislation, which we initiated among states… This Act, if installed, would have prevented the entirety of the crisis which the world has experienced since 2007.”